Case Study: Demotix (UK)

The name of the publication and / or company

Demotix

Established

January 2009

Web Address

Demotix.com

Form of the company

Limited company

Describe your site or business in few words.

Turi Munthe, CEO:

“Demotix is an online platform that allows anyone anywhere to upload their news, video and images. We vet that material and then license it on to mainstream media. Essentially we are a ‘citizen journalism AP’ (= newswire). We split the revenue from sales 50/50 with our contributors.

On the other hand, we are increasingly becoming also a news publisher. Our secondary business model, as of very recently, is advertising revenue on Demotix.com as a news site. In January this year we were getting about 1,3 million page views a month, which is what prompted us to bring on advertising revenue. We share that with our contributors, so that they get 80% and Demotix gets 20%.

Demotix seeks to be a solution to two problems: 1) the growing global free speech deficit and 2) the shrinking foreign news coverage in mainstream media. It provides a true platform for free speech, as we allow people to upload material anonymously and we strip all the metadata off so that they can’t be tracked back. We’ve completely ignored the US and are really focused on places like Iran and lots of African countries. On the other hand we’re trying to provide an alternative voice to mainstream media who rely evermore on Reuters and AP as they don’t have their own reporters anymore. Our understanding is that AP doesn’t have a staff reporter in 40 percent of the world’s countries, whereas Demotix is in almost every country.”

Staff numbers

Who’s creating the content

Content creators, paid revenue share 

5500

Are some of the content creators citizen contributors or interns?

“They are both freelancers and amateurs, but people for whom we are making real revenue tend to be pros and semi-pros. We are paying hundreds of contributors every month as we sell their images and videos. All in all we have 5 500 active contributors.”

How is your time divided between doing business and content?

Everything that we do is business but it’s designed around content.

Business, marketing & sales, paid full-time

10

Business, marketing & sales, paid half time

5

How they make money

Revenue models and sustainability

Would you say your business model is sustainable?

Yes, and growing. We are not profitable now because we’re reinvesting and have been doing so for a couple years. We took a fairly big investment from Corbis last year. We are hiring more team members and investing in technology. But were we to need to hit profitability, we could do that quite quickly.

How much is your yearly or monthly revenue?

Very healthily in the 5 figures a month (UK pounds)

Where does your revenue go?

Mostly salaries. All our growth now in terms of salaries is in tech.

How much do you pay to your contributors?

“The contributor gets half of what Demotix gets from a client.

Our publishing team looks at a story, checks it and verifies it, then puts it into the grids of our direct partners like The Guardian, The Daily Telegraph, Wall Street Journal, and The New York Post. It’ll sit on their grids for them to download whenever they want. We will either invoice them or they will alert us. The most simple form of sales. Half of the money goes back to the contributor, by Paypal usually.

We also have about 43 international resellers around the world who are licensing our images and videos, from Japan to Latin America.

We also have a deep structural relationship with a company called Corbis, which is the second biggest image library in the world. It’s owned by Bill Gates. We have a direct feed into their systems. They sell not so much breaking news but more archive material. Corbis is an investor in Demotix.”

What about profit?

Tech, tech, and more tech.

What kind of advertising you sell?

Cost Per Impression (CPM), Cost per Click (CPC), Sponsorship.

Other revenue sources

Freelancing – journalism, Freelancing – non journalism

Do you see your publication as your main product?

No, not at all. Our main product is our newswire.

What would be the most important thing on your road to sustainability?

“We are sustainable. More sales!”